Thu, Apr 9, 12:55pm by Charlotte Lee
Australia’s largest online gambling company, Tabcorp, has taken a battering from the cancellation of major sporting events and the shutdown licenced venues and TAB agencies where many of its client’s punt.
Business News Australia reports that new and obscure sport betting options like Belarusian Premier League and Tajikistan men’s basketball have been unable to compensate for loss of revenue that would normally come from the world’s most popular competitions in Australia and around the world.
The state of affairs led to the group temporarily standing down more than 700 employees to 30 June in businesses where there is no work due to coronavirus-related closures.
A further 160 technology contractors have also been let go, representing a cut of 40 per cent.
Business-as-usual expenditure for the current half is expected to be down by a quarter at around $120 million and Tabcorp has expanded its banking facilities through an additional $226 million short-term facility payable in mid-2021.
Managing director and TAB chief executive David Attenborough has also taken a 20 per cent fixed remuneration pay cut until the end of the financial year.
“This continues to be a very challenging time for our people, businesses, partners and the community,” says Mr Attenborough.
“We are committed to working proactively and collaboratively with all our stakeholders so that we can collectively emerge from the coronavirus period as strongly as possible.”
Meanwhile, chairman and non-executive director fees have been reduced by 10 per cent, following on from an earlier 10 per cent cut in September last year.
Tabcorp highlights its lotteries and keno and wagering and media digital channels are operations, as well as its lotteries retail network of newsagents, convenience stores and other outlets.
Thoroughbred, harness and greyhound race meetings in Australia, except Tasmania, continue to run in accordance with strict state government biosecurity and public health restrictions.
Fees owed in April by venues under Sky Racing, Tab, Keno and MAX contracts have been suspended and will be reviewed monthly.
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Australian gambling giant Tabcorp is disinclined to launch a bid to become the next operator of the United Kingdom’s national lottery, ahead of the bidding process kicking off this year.
The Sydney Morning Herald reported in January that the British Gambling Commission appointed investment bank Rothschild to engage with potential bidders interested in taking over the licence to run the national lottery when it expires in 2023.
Interested companies had been given until January 22 to respond to a consultation ahead of the start of the tender process.
Sources familiar with the matter on Tuesday indicated Tabcorp was “unlikely to participate” and was more focused on priorities in Australia.
One domestic priority for Tabcorp is the Western Australian TAB, gaming analysts said, after the WA government launched a process to privatise it in September.
Tabcorp is considered the most logical contender for the licence, but will face competition from foreign-owned online wagering companies operating in Australia.
Morgan Stanley analyst Elise Kennedy said a successful purchase of the WA TAB by Tabcorp seemed plausible, “as it is the only reported bidder with an existing retail footprint in Australia, and it stands to have the most financial benefit.”
ASX-listed Tabcorp recently merged with Tatts Group to become the nation’s largest gambling company, holding licences for lotteries and retail betting in every state and territory except Western Australia.
But Ms Kennedy warned the upside of acquiring the WA TAB may be limited and could “stretch Tabcorp’s balance sheet depending on the price paid and how a purchase was financed.”
Tabcorp’s first foray into the crowded United Kingdom market in 2016 – launching online betting service Sun Bets was a joint venture with Rupert Murdoch’s The Sun newspaper – ended less than two years later when Tabcorp decided to exit.
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